Chapter 09  Audit Sampling
CHAPTER 9
Audit Sampling
Review Questions
91
Nonstatistical sampling is an audit sampling technique in which the risk of sampling error is
estimated by the auditors using professional judgment rather than by the laws of probability.
Statistical sampling involves the quantification of the risk of sampling error through the use of
mathematics and laws of probability.
92
Sampling risk is the possibility that the auditors will make an erroneous decision based on a sample
result.
To control sampling risk the auditors increase the size of their samples.
Nonsampling risk
is the risk of erroneous conclusions by the auditors based on any factor other then sampling.
For
example, the auditors may perform inappropriate tests, or they may not recognize errors in the
sample items examined.
Nonsampling risk may be controlled by adequate planning and
supervision of engagements, and the establishment of effective quality control policies and
procedures.
93
The physical representation of the actual population is the recorded value that represents the
population.
For example, if the auditors use a computer printout of recorded accounts payable from
which to sample, they must attempt to determine that it properly includes all accounts payable.
94
All three of the methods of selecting items for examination (random number table selection,
systematic selection, random number generator selection) will produce a random sample if properly
applied.
However, when using systematic sampling on a population that is not in random order it
may be necessary to stratify the population into segments, or to use a relatively large number of
starting points to produce a random sample.
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Chapter 09  Audit Sampling
95
"Systematic selection" in auditing means drawing every
nth
item from the population of items to be
sampled.
For example, the auditors might draw every tenth check from a file of paid checks.
To
help insure a random sample, the auditors should ascertain that the population is in random
sequence, and is not, for example, classified by size of check.
If the population is not in random
order, the auditors may be able to stratify it into segments, each of which is in random order.
They
may also guard against a nonrandom sample by using several random starting points.
Systematic
selection is easily applied to unnumbered documents merely by counting off the sampling interval
between documents to be selected.
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Sampling
without
replacement means that once an item is drawn for inclusion in a sample, it is not
replaced into the population prior to drawing the remaining items.
Therefore, one item cannot be
included more than once in a given sample.
Sampling
with
replacement means that selected items
are replaced into the population prior to drawing the next item.
Under this method, it is possible
for one item in the population to be drawn several times, thus representing several sample items in
a given sample.
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